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CIPFA enthusiastically welcomes the report from the London Finance Commission, Raising the Capital, which was launched today.
The Commission, established by the Mayor and chaired by Prof Tony Travers, emphasises the importance of infrastructure investment to cater for the needs of a growing City over the next twenty years and beyond. Its recommendations are unambiguously localist and have the potential to be an important landmark in the development of the City's governance. In particular the Commission argues that the full suite of property taxes (council tax, business rates, stamp duty land tax, annual tax on enveloped dwellings and capital gains property development tax) should be devolved to London government.
Steve Freer, CIPFA's Chief Executive and a member of the Commission, said:
"The Commission's report focuses rigorously on the challenge of enabling London's future success and prosperity. There is a real coherence about its recommendations which aim to build on the localist policies of the Coalition Government. Hopefully we will see strong, cross-Party support for their adoption and early implementation."
The Commission's remit focuses exclusively on London. However, it has been careful to make recommendations which have the potential to be replicable in other Cities.
"The idea of City local government having full responsibility for a segment of the national tax base, property, has particular attractions. Over time it will enable careful calibration of different taxes to incentivise efficient use of property."
The Commission's report highlights the critical importance of infrastructure investment. It recommends that London government should be empowered to tackle these challenges with fewer externally imposed constraints on borrowing and greater access to tools such as City Deals and Tax Increment Financing.
"Local authorities already operate within a well-defined prudential regime which ensures that borrowing is carefully managed and affordable. Their track record in terms of responsible financial management is very good. Overlaying further controls risks stifling important investment, limiting growth and confusing accountability," said Freer.
The report was very warmly welcomed by both the Mayor, Boris Johnson, and Jules Pipe, representing London Councils, at today's launch. It works with the grain of a number of different strands of Government policy. For example, it resonates strongly with many aspects of Lord Heseltine's recent report, No Stone Unturned, which has been enthusiastically endorsed by Government.
Many of its recommendations now require action by Government to devolve necessary powers. However, the report also poses challenges for London government - the Mayor and the London Boroughs - to demonstrate its readiness and capability to work collaboratively to ensure that powers are used effectively for the benefit of the City and its current and future residents.
Contact: Matthew Patterson
CIPFA Press Office
t 020 7543 5600
Notes to editors
CIPFA, the Chartered Institute of Public Finance and Accountancy, is the professional body for people in public finance. Our 14,000 members work throughout the public services, in national audit agencies, in major accountancy firms, and in other bodies where public money needs to be effectively and efficiently managed. As the world’s only professional accountancy body to specialise in public services, CIPFA’s portfolio of qualifications are the foundation for a career in public finance. They include the benchmark professional qualification for public sector accountants as well as a postgraduate diploma for people already working in leadership positions. They are taught by our in-house CIPFA Education and Training Centre as well as other places of learning around the world. We also champion high performance in public services, translating our experience and insight into clear advice and practical services. They include information and guidance, courses and conferences, property and asset management solutions, consultancy and interim people for a range of public sector clients. Globally, CIPFA shows the way in public finance by standing up for sound public financial management and good governance. We work with donors, partner governments, accountancy bodies and the public sector around the world to advance public finance and support better public services.